Segment Information (Tables)

6 Months Ended

Jun. 25, 2023

The following tables present our segment information.


	Three Months Ended				Six Months Ended
(In thousands)	June 25, 2023		June 26, 2022		June 25, 2023		June 26, 2022
Revenues:
Domestic Company-owned restaurants	$	175,780	$	171,411	$	355,646	$	370,176
North America franchising	34,711		34,917		70,783		69,185
North America commissaries	206,980		219,383		419,546		429,062
International	41,354		39,282		80,058		81,989
All others	55,705		57,672		115,546		114,945
Total revenues	$	514,530	$	522,665	$	1,041,579	$	1,065,357

Intersegment revenues:
North America franchising	$	1,025	$	1,048	$	2,077	$	2,101
North America commissaries	51,586		52,754		103,403		111,261
International	869		—		869		—
All others	16,348		15,889		33,183		35,268
Total intersegment revenues	$	69,828	$	69,691	$	139,532	$	148,630

Operating income:
Domestic Company-owned restaurants (a)	$	6,641	$	5,924	$	13,291	$	7,912
North America franchising	32,111		32,624		65,511		64,761
North America commissaries	10,397		10,957		21,127		20,292
International (b)	3,763		7,306		10,995		11,761
All others	1,343		2,187		4,500		5,906
Unallocated corporate expenses (c)	(19,701)		(19,344)		(43,067)		(56,454)
Elimination of intersegment (profits) losses	358		(750)		351		(839)
Total operating income	$	34,912	$	38,904	$	72,708	$	53,339


Property and equipment, net:
Domestic Company-owned restaurants	$	242,089
North America commissaries	155,681
International	27,748
All others	139,114
Unallocated corporate assets	248,387
Accumulated depreciation and amortization	(548,626)
Total property and equipment, net	$	264,393

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(a) The six months ended June 26, 2022 includes a one-time, non-cash charge of $8.4 million associated with the refranchising of the Company’s ownership interest in a 90-restaurant joint venture, recorded as Refranchising and impairment loss. See “Note 10. Divestitures” for additional information.

(b) The three and six months ended June 25, 2023 includes $1.3 million of costs associated with repositioning the UK portfolio as well as transaction costs related to the acquisition of stores from franchisees. The six months ended June 26, 2022 includes $3.5 million of one-time, non-cash reserves for certain accounts receivable and impairments of reacquired franchise rights. See “Notes 2. Significant Accounting Policies” and “10. Divestitures” for additional information.

(c) The three and six months ended June 25, 2023 includes $0.7 million and $2.0 million, respectively, of severance and related costs associated with the transition of certain executives. The three months ended June 26, 2022 includes $1.5 million of advisory fees and severance costs associated with the transition of certain executives. The six months ended June 26, 2022 includes $13.9 million of one-time, non-cash reserves of certain notes receivable, $5.0 million for certain legal settlements, and $1.5 million of advisory fees and severance costs associated with the transition of certain executives. See “Notes 2. Significant Accounting Policies” and “9. Litigation, Commitments and Contingencies” for additional information.

Schedule of revenue disaggregated by major product line

In the following tables, revenues are disaggregated by major product/service line. The tables also include a reconciliation of the disaggregated revenues by the reportable segment (in thousands):


	Reportable Segments
	Three Months Ended June 25, 2023
Major Products/Services Lines	Domestic Company-owned restaurants		North America franchising		North America commissaries		International		All others		Total
Company-owned restaurant sales	$	175,780	$	—	$	—	$	3,018	$	—	$	178,798
Franchise royalties and fees	—		35,736		—		12,196		—		47,932
Commissary sales	—		—		258,566		20,263		—		278,829
Other revenues	—		—		—		6,746		72,053		78,799
Eliminations	—		(1,025)		(51,586)		(869)		(16,348)		(69,828)
Total segment revenues	175,780		34,711		206,980		41,354		55,705		514,530
International other revenues (a)	—		—		—		(6,746)		6,746		—
Total revenues	$	175,780	$	34,711	$	206,980	$	34,608	$	62,451	$	514,530

	Reportable Segments
	Three Months Ended June 26, 2022
Major Products/Services Lines	Domestic Company-owned restaurants		North America franchising		North America commissaries		International		All others		Total
Company-owned restaurant sales	$	171,411	$	—	$	—	$	—	$	—	$	171,411
Franchise royalties and fees	—		35,965		—		12,043		—		48,008
Commissary sales	—		—		272,137		19,915		—		292,052
Other revenues	—		—		—		7,324		73,561		80,885
Eliminations	—		(1,048)		(52,754)		—		(15,889)		(69,691)
Total segment revenues	171,411		34,917		219,383		39,282		57,672		522,665
International other revenues (a)	—		—		—		(7,324)		7,324		—
Total revenues	$	171,411	$	34,917	$	219,383	$	31,958	$	64,996	$	522,665

	Reportable Segments
	Six Months Ended June 25, 2023
Major Products/Services Lines	Domestic Company-owned restaurants		North America franchising		North America commissaries		International		All others		Total
Company-owned restaurant sales	$	355,646	$	—	$	—	$	3,018	$	—	$	358,664
Franchise royalties and fees	—		72,860		—		24,687		—		97,547
Commissary sales	—		—		522,949		39,235		—		562,184
Other revenues	—		—		—		13,987		148,729		162,716
Eliminations	—		(2,077)		(103,403)		(869)		(33,183)		(139,532)
Total segment revenues	355,646		70,783		419,546		80,058		115,546		1,041,579
International other revenues (a)	—		—		—		(13,987)		13,987		—
Total revenues	$	355,646	$	70,783	$	419,546	$	66,071	$	129,533	$	1,041,579



	Reportable Segments
	Six Months Ended June 26, 2022
Major Products/Services Lines	Domestic Company-owned restaurants		North America franchising		North America commissaries		International		All others		Total
Company-owned restaurant sales	$	370,176	$	—	$	—	$	—	$	—	$	370,176
Franchise royalties and fees	—		71,286		—		25,478		—		96,764
Commissary sales	—		—		540,323		41,097		—		581,420
Other revenues	—		—		—		15,414		150,213		165,627
Eliminations	—		(2,101)		(111,261)		—		(35,268)		(148,630)
Total segment revenues	370,176		69,185		429,062		81,989		114,945		1,065,357
International other revenues (a)	—		—		—		(15,414)		15,414		—
Total revenues	$	370,176	$	69,185	$	429,062	$	66,575	$	130,359	$	1,065,357

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(a) Other revenues as reported in the Condensed Consolidated Statements of Operations include $6.7 million and $14.0 million of revenues for the three and six months ended June 25, 2023, respectively, and $7.3 million and $15.4 million for the three and six months ended June 26, 2022, respectively, that are part of the International reporting segment. These amounts include marketing fund contributions and sublease rental income from international franchisees in the United Kingdom that provide no significant contribution to operating income but must be reported on a gross basis under accounting requirements. The related expenses for these Other revenues are reported in Other expenses in the Condensed Consolidated Statements of Operations.